The use of nonphysician practitioners has exploded in recent years. The Centers for Medicare and Medicaid Services (CMS) recognize the value that physician assistants, nurse practitioners, clinical nurse specialists, nurse midwives, and clinical psychologists contribute as so-called nonphysician practitioners. Assuming proper state licensure, these professionals can do many of the same tasks as the supervising physician.
The rub comes in billing. Some hospitals, clinic and doctors improperly bill these services to Medicare at the physician rate or bill their services when not authorized That includes using these professionals without proper supervision.
CMS has very strict rules on billing by non physician practitioners. A violation of those rules can give rise to whistleblower awards under federal and state Medicare fraud laws.
“Incident to” Services by Nonphysician Practitioners
Medicare pays for services rendered by a physician’s employees only certain criteria are met. These are called “incident to” services. According to CMS, “To qualify as ‘incident to,’ services must be part of [the] patient’s normal course of treatment, during which a physician personally performed an initial service and remains actively involved in the course of treatment.” The physician need not be physically present in the patient’s treatment room while these services are provided, but he or she must provide direct supervision and must be present in the office suite to render assistance, if necessary.
These services are generally billed at 85% of the physician’s fee schedule. Unfortunately, we have seen several Medicare fraud schemes involving improper billing. Often that billing involves billing for incident to services when the physician is not in the office. In one case discussed below, the doctor was not even in the United States!
If the patient is seen in the doctor’s office, the practitioner must be directly supervised by the physician. CMS interprets that rule to mean within the office but not necessarily in the treatment room. If the doctor is part of a medical group, any physician in the group can supervise. That means a patient of Dr. Smith can be seen by a NP even though Dr. Smith is on vacation, assuming of course, that one of Dr. Smith’s partners is on the premises and available to assist.
Hospital and Nursing Home Visits
Incident to services are not generally billable to Medicare.
Offices within Hospitals and Nursing Homes
If the physician has a separate office within the facility, the “incident to” rules apply to outpatients and not patients who have been admitted to the facility.
Unless the patient resides in an area designated by the government as underserved, the doctor must be present in the house in order for “incident to” billing rules to apply.
Special Rules for PAs and NPs During Surgery
Medicare rules allow physician assistants and nurse practitioners to assist during surgery. Obviously, they must also comply with state licensing requirements. If the practitioner truly helps the doctor with performing the actual surgery, he or she can bill as an assistant at surgery and receive 85% of the physician rate.
The rules are not the difficult to understand, yet many providers try to defraud Medicare and bill for services provided by nonphysician practitioners (sometimes also called physician extenders). Unfortunately, we have seen hospitals and physicians improperly bill their nonphysician practitioners.
Examples of Medicare Fraud Involving Nonphysician Practitioners
In 2014, Duke University settled a False Claims Act lawsuit alleging that the hospital was billing the government for services provided by physician assistants (PA’s) during coronary artery bypass surgeries when the PA’s were acting as surgical assistants which was not allowed under government regulations. The hospital system was also charged with increasing billing by unbundling claims when the unbundling was not appropriate. The allegations all dealt with specifically cardiac and anesthesia services.
The Duke case was originally filed by a former employee of the hospital system, Leslie Johnson. As a coding supervisor and later as a quality assurance specialist, Ms. Johnson conducted audits of the hospital’s Medicare billing. During her employment, she learned that the hospitals were falsely billed for the presence of physician assistants at coronary bypass surgeries when they were present only at a related vein harvesting procedure. She also found that the hospitals billed surgeries performed by physician assistants as if surgeons performed them.
In announcing the settlement, North Carolina Attorney General Roy Cooper said, “Health care fraud like this wastes tax dollars, harms patients who need care, and drives up medical costs for all of us. We’re working closely with federal officials to root out this kind of fraud in North Carolina and make wrongdoers pay.”
More recently in Florida, the Justice Department successfully prosecuted another Medicare fraud case involving physician assistants. In December of last year, Southeast Orthopedic Associates (SOS) agreed to pay $4.4 million to resolve False Claims Act claims.
In the SOS case, the government alleged that SOS “knowingly billed for certain claims as ‘incident to’ physician supervision when no physician was present or there was no verification of any physician being present.”
In 2015, a Jacksonville fertility clinic settled Medicare fraud charges for billing by physician extenders. The government claimed that PA’s and nurse practitioners were billing “incident to” services when the clinic’s owner, Dr. Michael Fox was not in the office. In fact, prosecutors said at times, he wasn’t even in the United States.
All of these examples involve fraud to taxpayers. Medicare, Medicaid and Tricare are paid with tax dollars. When a clinic defrauds Medicare, all taxpayers suffer.
Ripping off taxpayers is bad enough. But billing for services performed by NP’s can also put patients at risk.
We know that nurse practitioners and physician assistants perform a valuable service. There are simply not enough doctors to go around in certain areas of the country. Medicare gladly pays for their services but they need to be actively supervised and a doctor must generally be on the premises.
Leaving the nonphysician practitioners in charge isn’t fair to those folks and also represents a danger to the patient should something go wrong and no one is present to assist.
False Claims Act Whistleblower Awards
In the three cases cited above, all were brought under the False Claims Act. That law allows healthcare professionals with inside knowledge about Medicare or Medicaid fraud to file a lawsuit against the wrongdoer. The suit is filed in the name of the government and not the whistleblower. If the lawsuit succeeds, the whistleblower can receive between 15% and 30% of whatever the government collects from the wrongdoers.
Most whistleblowers in these cases are the PA’s and nurses themselves or billing specialists. Sometimes these cases are brought by other doctors.
To qualify for an award, you must have inside knowledge of the wrongdoing and generally must be the first to file a claim. Some practitioners are reluctant to coming forward out of fear that they may get in trouble for their own actions. Unless you were the physician or hospital administrator who orchestrated the illegal billing scheme, nurse practitioners and PA’s have little to fear.
If we are hired to represent you, we can usually work out these concerns with prosecutors before disclosing your name and before filing a claim.
When the case is filed, it is filed under seal meaning it is secret. Your name generally will not be disclosed to the doctor or hospital while the government investigates.
Each year tens of thousands of people call state and federal Medicare hotline numbers. Doing that won’t get you a big percentage award and probably doesn’t even stop the fraud. Very few whistleblowers know about the False Claims Act and the awards available. Each year about 700 people file claims under the Act. And each year the government pays out hundreds of millions of dollars to those folks.
For more information, contact attorney Brian Mahany at or by phone at (direct). All inquiries are confidential and protected by the attorney – client privilege. We are a nationwide law firm fighting healthcare fraud wherever it occurs.
[See also our Medicare Fraud whistleblower page.]